Australian cotton growers and transporters recently said that due to the continued drought, Australia’s cotton production in the next season may be significantly halved. According to producer Cotton Australia, Australia’s cotton output in 2014-2015 will be between 2-2.5 million bales (227 kilograms per bale), which is a significant decrease from this year’s output of about 4 million bales. The Australian Cotton Shipping Association (ACSA) predicts that Australia’s cotton output will be 2.25 million bales next season.
Considering that Australia is the third largest cotton exporter in the world, and the cotton production of the United States, the world’s largest cotton exporter, is rising, the reduction in Australian cotton production will add fuel to the fire of global cotton reserves that have hit a record high. Cotton futures prices this year down 24%.
Adam Kay, head of Cotton Australia, said that due to the extremely rare drought in Queensland and drought conditions in parts of New South Wales, local farmers may reduce cotton planting. According to the Australian Bureau of Agriculture, Resource Economics and Science’s forecast in June, Australia’s cotton exports may fall by 11% to 870,000 metric tons in the year starting July 1, equivalent to 3.8 million bales.
The Australian Cotton Transport Association predicts that Australian cotton production will decline by 34% between 2014 and 2015. Gordon Cherry, manager of the Australian Cotton Transport Association, pointed out, “Our forecast is based on continued drought conditions. If cotton If prices weaken further, the planting area may continue to decline.”
